MA Residents: There Are 3 Big Social Security Changes Taking Effect in 2024
Social Security benefits are a key source of income in retirement, and they tend to become increasingly important over time. Pay heed to a trio of big changes to Social Security that will take effect on January 1st, 2024:
For starters, Social Security beneficiaries will get a 3.2% cost of living adjustment to account for rising prices across the economy. If you ask me, any extra MOOLAH, MOOLAH, MOOLAH is a welcome opportunity to add to your pocket or wallet. Translation: the average retiree will get an additional $59 per month and that's a good thing if you ask me.
The maximum retired worker benefit for new beneficiaries will increase. While workers are entitled to retirement benefits at age 62, delaying Social Security makes the payout larger. But would you really want to wait a little longer to receive what you are entitled to? Indeed, the maximum retired worker benefit at age 70 will average about 27% larger than the maximum benefit and 80% greater than the maximum benefit at age 62.
Another key point is if you are working, DO NOT exceed the limits set by Social Security. Those limits, referred to as the retirement earnings test exempt amounts, are adjusted each year based on changes in general wage levels. If you are in the lower limit category of $22,320 per year (or $1,860 per month), that is up from $21,240 per year (or $1,770 per month) in 2023. Upper limit recipients have to make $59,520 per year (or $4,960 per month), up from $56,520 per year (or $4,710 per month) in 2023.
$1 in benefits will be withheld for every $2 in earnings that exceed $22,320 in 2024. The higher limit states $1 in benefits will be withheld for every $3 in earnings that exceed $59,520 in 2024. Sounds complicated? Solution: keep your work schedule in the proper parameters and you will NOT see any possible deductions.
BOTTOM LINE: Once you learn how to maximize your Social Security benefits, you could retire confidently with the peace of mind we're all after.
(Some information obtained in this article courtesy of www.fool.com/retirement/2023)
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